PERU: Dam Project Temporarily Suspended to Calm Protests

LIMA, Jun 20 2011 (IPS) - The outgoing government of Peruvian President Alan García has suspended construction of the Inambari hydroelectric complex, part of an energy deal with Brazil. But activists say the move is merely aimed at calming tempers among local people opposed to the dam, while handing the problem on to García’s successor, president-elect Ollanta Humala. “Inambari is back to square one, and that’s that,” Tatiana Berger, press adviser to the Ministry of Energy and Mines, told IPS after the government published a resolution Jun. 15 declaring the end of the temporary concession granted to the Brazilian consortium EGASUR (Energy Generation in the Southern Amazon) to carry out preliminary work on the project.

The resolution, which emerged from negotiations with mayors and local leaders in the southern region of Puno, also highlights that “any electricity rights related to the Inambari hydroelectric plant project must be subject to prior consultation” with local indigenous peoples, as stipulated in the International Labour Organisation’s (ILO) Convention 169 on Indigenous and Tribal Peoples.

The Inambari dam site is at the junction of the regions of Puno, Cuzco and Madre de Dios in southeastern Peru, where some 70 communities would have to be relocated if the dam and reservoir, which would cover 37,800 hectares according to EGASUR’s feasibility study, go ahead.

Although the Peruvian government’s new resolution calmed protests by social movements in Puno, the conflict is still latent because the project itself has not been definitively cancelled, according to local activists and experts interviewed by IPS.

“We have merely been given a truce,” the head of the Committee of Struggle of Carabaya province, in Puno, Hernán Vilca, told IPS. “What we want is a decree that guarantees the definitive cancellation of the project.

“We will insist on this with the present government and with future president Humala,” who takes office Jul. 28, he said.

The deadline for the Ministry of Energy and Mines to grant a new extension to EGASUR’s temporary concession expired Oct. 7, 2010, because the company had already obtained the maximum extension of one additional year stipulated by law.

“The new resolution only formalises what was already known eight months ago, and proposes nothing new,” said lawyer César Gamboa of the civil society organisation Law, Environment and Natural Resources (DAR). “The good thing is that the case has become known all over the world.”

EGASUR sent a letter Oct. 7, 2010 to the Electricity Directorate of the Ministry of Energy and Mines, in which the company requested that its feasibility studies, attached to the letter, be accepted as the fulfilment of its obligations under the temporary concession.

IPS has seen the document, in which EGASUR made it plain that it had completed the technical, economic and environmental assessments that comprised the feasibility studies, within the period of its temporary concession.

Because of this, experts like Gamboa maintain that in spite of the end of the temporary concession, the company can continue to prepare the environmental impact assessment (EIA) that has not yet been submitted, since it has carried out the preliminary studies, and it could request a permanent concession later on.

“The law does not compel the company to have a temporary concession in force in order to obtain a permanent concession,” Gamboa added.

The biggest hurdle is guaranteeing citizen participation, which is required as part of drawing up the EIA, because local people, especially in Puno, are firmly against the project due to its potential social and environmental impacts. EGASUR has failed to carry out the second round of its information workshops with local people.

But the Ministry of Energy and Mines assured IPS that it has received no documents related to the EIA, and that no evaluation process is under way for the Inambari project.

In Brazil, however, the issue has not been laid to rest. The day after the Peruvian government reported that it had cancelled the temporary concession, a spokesperson for Eletrobras, a partner company in EGASUR, told the regional news agency Business News Americas that the Inambari project is still viable.

The Brazilian Ministry of Mines and Energy’s planning secretary, Altino Ventura, told IPS that their understanding is that Peru will review the project, “in consultation with its laws and the local communities.” He added that the June 2010 energy agreement with Peru is still awaiting final approval by the Brazilian Congress.

The Inambari hydropower plant “is of interest to both countries” and the energy it produces “will first and foremost supply Peru’s needs,” with the excess going to Brazil, he said.

Nevertheless, Peruvian experts have pointed out that Peru has not yet determined its energy needs for the next 30 years, the period covered by the agreement, and therefore cannot set the percentage of energy it will use for domestic consumption, a figure that cannot be subsequently modified.

Under the bilateral energy agreement, there were also plans to build the hydroelectric plants of Mainique, in Cuzco, and Paquitzapango, Tambo 60 and Tambo 40, in Junín.

The Mainique project has also gone back to the drawing board, as it was located in the buffer zone surrounding the Megantoni National Sanctuary and lacked prior approval from the National Service for Protected Areas, as required by law.

The same thing is happening with Paquitzapango, where the temporary concession has lapsed and it is unlikely that the project will be resumed because of strong opposition by the native Ashaninka people to the planned plant, which was to have been financed by the powerful Brazilian firm Odebrecht.

Vilca, of the Carabaya Committee of Struggle, said “We are concerned about president-elect Humala’s close ties with Brazil. We will stay alert and write letters to all the ministries.” The activist said other pending issues with the government are the withdrawal of mining concessions in the province and the environmental recovery of the Ramis river basin.

Berger, the press adviser for the Peruvian Ministry of Energy and Mines, said that in future EGASUR or any other company could make another request for a temporary concession. Meanwhile, the Peru-Brazil energy agreement remains in force, awaiting new projects backed by Brazilian capital to bring it to life.